Tuesday 15 June 2021

Biggest business group joins Park in Latin America

Park Geun-Hye has become South Korea's first female president, vowing zero tolerance with North Korean provocation.
Park Geun-Hye has become South Korea’s first female president, vowing zero tolerance with North Korean provocation.

TODAY COLOMBIA – President Park Geun-hye landed in Colombia raising hopes that a free trade agreement with the country might finally be approved by the South American nation.
At the same time, Korean businesses over the weekend succeeded in striking business deals in various sectors ranging from e-commerce and ICT to shipping and financial services.

On Friday, Park arrived in Bogota, Colombia’s capital city, and had a summit with the Colombian President Juan Manuel Santos on Saturday to request acceleration of the two countries’ bilateral FTA and expansion of economic cooperation.

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“For Colombia, the Korea-Colombia FTA, which was sealed in June 2012, is the first free trade pact made with an Asian country,” Park said at a press briefing after the summit, “I hope the FTA goes into effect as early as possible so that it becomes a starting point for Korean businesses to explore the Central and South American market.”

Park reiterated her hopes for the FTA in another meeting with Colombian veterans of the Korean War.

“Korea and Colombia so far have developed the blood-linked relationship started in the war into a strategic cooperative partnership,” she said. “Once the two countries’ FTA goes into effect, the relationship will be even closer.”

Korea-Colombia FTA negotiation ended in 2012 and the deal was signed in February 2013. The FTA was passed by the Korean National Assembly last April but its ratification has been held up on the Colombian side.

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“The Korea-Colombia FTA being unable to go in effect is not due to disagreements about the trade pact negotiations, but because of strong oppositions from local industrial circles,” said an official at the Korean Ministry of Trade, Industry and Energy.

The pact was passed by both upper and lower houses of the Colombian legislature, but the Colombian Constitutional Court ruled that it needs an agreement from local industry to be constitutional.

Colombia has a $400 billion gross domestic product and enjoyed 4.8 percent economic growth last year. The country was selected by the World Bank last year as the best place to do business within Latin America.

Park is visiting four Latin American countries accompanied by a delegation of some 500 businessmen from 125 companies, the largest of any of her presidential trips abroad. They represent a wide variety of sectors including manufacturing, IT, healthcare, retail, construction, energy and the environment. Small and midsize companies account for 62 percent of the delegation.

The Export-Import Bank of Korea and its Colombian counterpart Financiera de Desarrollo Nacional (FDN) signed a memorandum of understanding (MoU) on Friday to establish a joint fund for the country’s state-led infrastructure projects.

A joint financing project is aimed at accelerating the two countries’ economic cooperation after the FTA takes effect, said Korea Eximbank.

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The MoU also promised to form a joint financing network with nearby countries like Brazil, Peru and Chile in order to aid Korean businesses’ expansion in Latin America.

LG CNS suggested expanding ICT cooperation between the two countries at a Korea-Colombia Business Forum held Saturday by implementing the so-called e-government system, which delivers government rvices via Internet or mobile device, in Colombia. The network developer built an ICT-enabled automated public transportation payment system in Colombia’s capital Bogota in 2011 and an ICT training system in 2013.

Kotra hosted a one-on-one business consultation meeting and export contracts worth $101 million were signed by 44 Korean companies and 91 local companies.

Many of the contracts involved e-commerce. Kotra signed MoUs with Colombia’s largest online shopping mall Linio and largest retail company Gropo Exito, in order to promote Korean products.

CJ O Shopping and CJ Korea Express made agreements with Kotra on Friday to assist Kotra-affiliated small exporters.

As of now, Korea has FTAs in effect with only two Latin American countries, Chile (since 2004) and Peru (since 2011).

Korea’s trade with Central and South America almost tripled over the past decade. According to Korea International Trade Association data, Korean exports in 2004 were $11.5 billion, but reached $35.9 billion last year, while imports to Korea rose to $18.3 billion last year from $6.6 billion in 2004.

“The FTA with Colombia will play a crucial role in opening a new era of cooperation among the Pacific Rim countries, as Korea already has FTAs with major Pacific countries, the United States, Canada, Peru and Chile,” Joo Chul-ki, senior presidential secretary for foreign affairs, said.

The Korean government hopes to push a regional FTA with Panama, Costa Rica, Guatemala, Honduras, Dominican Republic and El Salvador, as well as one with South American countries, including Brazil, Argentina and Paraguay.

After Colombia, Park will travel to Peru, Chile and Brazil.

This article originally appeared on Korea Joongang Daily.

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FACT CHECK:
We strive for accuracy in its reports. But if you see something that doesn’t look right, send us an email. The Q reviews and updates its content regularly to ensure it’s accuracy.

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"Rico" is the crazy mind behind the Q media websites, a series of online magazines where everything is Q! In these times of new normal, stay at home. Stay safe. Stay healthy.

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